Capital Market

The term capital market is used for a financial market that engages in the process of buying and selling equities, bonds and long term debts. The main purpose of such a market is to channelise funds in surplus from investors to institutions. The funds are then invested for productive use. Basically, a capital market is meant for trading in long term securities. There are two types of capital markets viz. primary markets and secondary markets. A primary market mainly deals with the exchange of stocks and securities as well as new issues. On the other hand, a secondary market deals with the trade of previously issued or existing securities. A capital market is also divided according to the nature of the stock that has been traded i.e. bond market and stock market. There can be many participants of capital markets such as institutional investors, individual investors, governments and municipalities, organizations, companies, banks as well as financial institutions.

Ads by Google

Edited and Updated 31st May 2014

You can leave a response, or trackback from your own site.

Leave a Reply

You must be logged in to post a comment.

Powered by WordPress